EXHIBIT 10.11
STANDBY PURCHASER AGREEMENT
_____________, 2005
______________________
______________________
______________________
Dear ____________:
This letter confirms our agreement with respect to the intention of
Patriot National Bancorp, Inc., a Connecticut corporation (the "Company"), to
raise additional capital through a rights offering, with oversubscription
privileges, of up to ___________ shares (the "Underlying Shares") of the
Company's common stock, par value $2.00 per share (the "Common Stock"), to its
shareholders of record as of date to be determined ("Rights Offering") with the
participation of standby purchasers for any unsubscribed shares in the Rights
Offering (the Rights Offering and the offering to standby purchasers are
hereinafter referred to as the "Offering"). Capitalized terms used herein and
not defined herein shall have the meanings set forth in the Prospectus (as
hereinafter defined.)
A REGISTRATION STATEMENT ON FORM SB-2 (THE "REGISTRATION STATEMENT")
RELATING TO THE COMPANY'S COMMON STOCK WAS FILED WITH THE SECURITIES AND
EXCHANGE COMMISSION ("SEC") ON APRIL __, 2005. NO OFFER TO BUY SECURITIES CAN BE
ACCEPTED AND NO PART OF THE PURCHASE PRICE CAN BE RECEIVED UNTIL THE
REGISTRATION STATEMENT HAS BECOME EFFECTIVE, AND ANY SUCH OFFER MAY BE WITHDRAWN
OR REVOKED, WITHOUT OBLIGATION OR COMMITMENT OF ANY KIND, AT ANY TIME PRIOR TO
NOTICE OF ITS ACCEPTANCE GIVEN AFTER THE EFFECTIVE DATE.
1. PURCHASE AND SALE OF UNSUBSCRIBED SHARES.
(a) Subject to the terms and conditions and in reliance upon the
representations and warranties herein set forth, the Company agrees to issue and
sell to you as a standby purchaser (the "Standby Purchaser") and the Standby
Purchaser agrees to purchase from the Company at the subscription price set
forth in the Prospectus (the "Subscription Price") up to __________ shares of
Common Stock (the "Standby Shares") which remain available for issuance in
accordance with the Rights Offering after the issuance of all shares of Common
Stock validly subscribed for through the exercise of rights (the "Rights"),
including the exercise of all oversubscription privileges, in the Rights
Offering (such remaining shares being hereinafter referred to as the
"Unsubscribed Shares").
(b) The Standby Purchaser and the Company acknowledge and agree
that the Company has entered into, or contemplates entering into, one or more
other Standby Purchase
Agreements with certain other parties (collectively, the "Standby Purchasers")
on terms substantially similar to this Agreement, except that they may provide
for the purchase of a different maximum number of Standby Shares in Section 1(a)
and a different number of Minimum Shares (as defined in Section 1(c)). The
Unsubscribed Shares available for issuance to Standby Purchasers and any
additional shares which the Company shall have elected to issue shall be
allocated (to the extent any allocation thereof is necessary) as nearly as
possible on a pro rata basis among the Standby Purchasers based upon the number
of Standby Shares subscribed for by each such Standby Purchaser, after giving
effect to the limitation set forth in Section 2(a).
(c) In the event there is not a sufficient number of Unsubscribed
Shares remaining upon completion of the Rights Offering (including the exercise
of all oversubscription privileges) to allow you to purchase at least __________
shares pursuant to Section l(a) (the "Minimum Shares"), subject to the maximum
number of shares of Common Stock being offered for sale in the Offering as set
forth in the Registration Statement, the Company agrees to issue and sell to the
Standby Purchaser, and the Standby Purchaser agrees to purchase from the
Company, at the Subscription Price and otherwise in accordance with this
Agreement, sufficient additional shares so that the Standby Purchaser shall have
purchased the Minimum Shares, provided that the Company may need to reduce the
Minimum Shares committed to by the Standby Purchaser (on a pro rata basis with
all other Standby Purchasers) in order to ensure that the number of shares
issued by the Company in the Offering does not exceed the maximum number of
shares of Common Stock being offered for sale in the Offering. The shares to be
issued and sold to the Standby Purchaser (other than the Unsubscribed Shares) in
order that the Standby Purchaser may purchase the Minimum Shares are hereinafter
referred to as the "Additional Shares."
2. LIMITATIONS ON ISSUANCE OF STANDBY SHARES.
(a) MAXIMUM HOLDING. The Standby Purchaser acknowledges and agrees
that, notwithstanding anything to the contrary herein contained or implied, the
Company will not issue to the Standby Purchaser shares of Common Stock in an
amount which, when aggregated with other shares of Common Stock owned or
controlled by the Standby Purchaser, would exceed 9.9% of the total issued and
outstanding shares of Common Stock upon completion of the Offering, including
shares issued pursuant to any Standby Purchase Agreements.
(b) FAILURE TO OBTAIN REGULATORY APPROVAL. The Standby Purchaser
hereby acknowledges and agrees that the Company may decline to issue shares of
Common Stock to the Standby Purchaser hereunder if, in the opinion of the
Company, the Standby Purchaser is required to obtain prior clearance or approval
of such purchase from any state or federal bank regulatory authority and if such
approval or clearance has not been obtained or if satisfactory evidence thereof
has not been presented to the Company prior to the expiration of the Offering.
3. THE CLOSING.
As soon as practicable following its determination of the number of
Unsubscribed Shares, the Company shall notify the Standby Purchaser of the
number of Standby Shares, if any, to be purchased by the Standby Purchaser
pursuant to Section l(a) and the number of Additional Shares, if any, to be
purchased by the Standby Purchaser pursuant to Section 1(c). The delivery of and
payment for the Standby Shares and the Additional Shares shall take place at the
offices
2
of Xxxxxx Xxxxx LLP, Washington, D.C., at 10:00 a.m., Eastern time, immediately
after the closing of the sale of shares of Common Stock pursuant to the Rights
Offering, such time and date to be not more than five (5) business days after
the foregoing notification and to be specified therein (such time and date being
referred to as the "Closing Time," the date of the Closing Time being referred
to as the "Closing Date" and the consummation of the transaction being referred
to as the "Closing").
4. DELIVERY OF STANDBY SHARES AND ADDITIONAL SHARES.
At the Closing, the Standby Shares and Additional Shares to be
purchased by the Standby Purchaser hereunder, registered in the name of the
Standby Purchaser or its nominee(s), as the Standby Purchaser may specify in
writing at least three (3) days prior to the Closing Date, shall be delivered by
or on behalf of the Company to the Standby Purchaser, for the Standby
Purchaser's account, against delivery by the Standby Purchaser of the
Subscription Price therefor in immediately available funds in the form of one or
more federal funds checks or a wire transfer to an account designated by the
Company.
5. REPRESENTATIONS AND WARRANTIES.
The Company and the Standby Purchaser hereby confirm their agreement as
follows:
(a) The Company represents and warrants to, and covenants with,
the Standby Purchaser as follows:
(i) The Company has filed a Registration Statement on
Form SB-2 with the SEC and all amendments thereto. Such Registration Statement
as amended at the time it becomes effective (the "Effective Date"), including
all exhibits, is herein called the "Registration Statement." The prospectus
filed with the SEC pursuant to the Securities Act of 1933, as amended (the
"Securities Act"), and the regulations promulgated thereunder ("Regulations"),
and which constitutes a part of the Registration Statement, is herein called the
"Prospectus."
(ii) The Underlying Shares, the Standby Shares and the
Additional Shares have been duly authorized by the Company, and when issued and
delivered by the Company against payment therefor, will be duly and validly
issued, fully paid and non-assessable. The Rights have been duly authorized by
the Company, and when issued and delivered by the Company, will constitute valid
and legally binding obligations of the Company, subject to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and similar laws of
general applicability relating to or affecting creditors' rights and to general
equity principles.
(iii) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State of
Connecticut, with corporate power and authority to perform its obligations under
this Agreement.
(iv) The execution, delivery and performance of this
Agreement by the Company and the consummation by the Company of the transactions
contemplated hereby have been duly authorized by all necessary corporate action
of the Company and this Agreement, when duly executed and delivered by the
Standby Purchaser, will constitute a valid and legally binding agreement of the
Company enforceable in accordance with its terms, except as may be
3
limited by bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability relating to or affecting
creditors' fights and to general equity principles.
(v) On the Closing Date and at the time when the
Registration Statement was first filed with the SEC pursuant to the Securities
Act and the Regulations, the Registration Statement and the Prospectus complied
and will comply in all material respects with the requirements of the Securities
Act and the Regulations and on the Closing Date, neither the Registration
Statement nor the Prospectus will contain an untrue statement of a material fact
or omit to state a material fact required to be stated therein or necessary to
make the statements therein, in the light of the circumstances under which they
were made, not misleading; except that the foregoing does not apply to
statements or omissions in the Registration Statement or the Prospectus made in
reliance upon and in conformity with information furnished by the Standby
Purchaser to the Company expressly for use therein.
(vi) Neither the Company nor any of its direct or indirect
subsidiaries ("Subsidiaries") is in violation of its certificate of
incorporation, articles of association, certificate of trust or bylaws or in
default under any agreement, indenture or instrument to which the Company or any
of its Subsidiaries is a party, the effect of which violation or default would
be material to the business, properties, financial condition or results of
operations of the Company and its Subsidiaries, taken as a whole, and the
execution, delivery and performance of this Agreement by the Company and the
consummation of the transactions contemplated hereby will not conflict with, or
constitute a breach of, or default under, or result in the creation or
imposition of any lien, charge or encumbrance upon any of the assets of the
Company or its Subsidiaries pursuant to the terms of any agreement, indenture or
instrument to which the Company or any of its Subsidiaries is a party, or result
in a violation of the certificate of incorporation, articles of association,
certificate of trust or bylaws of the Company or any of its Subsidiaries or any
order, rule or regulation of any court or governmental agency having
jurisdiction over the Company, any of its Subsidiaries or any of their property;
and, except as required by the Regulations, the Securities Exchange Act of 1934,
as amended (the "Exchange Act"), and applicable state securities law, no
consent, authorization or order of, or filing or registration with, any court or
governmental agency is required for the execution, delivery and performance of
this Agreement.
(vii) The Company has applied to have the shares of Common
Stock approved for quotation on the Nasdaq SmallCap Market and will use its best
efforts to obtain such approval.
(b) The Standby Purchaser represents and warrants to, and
covenants with, the Company as follows:
(i) (A) If the Standby Purchaser is an individual,
he or she has full power and authority to perform his or her obligations under
this Agreement.
(B) If the Standby Purchaser is a corporation,
the Standby Purchaser is a corporation duly incorporated, validly existing and
in good standing under the laws of its
4
jurisdiction of incorporation, with corporate power and authority to perform its
obligations under this Agreement.
(C) If the Standby Purchaser is a trust, the
Trustee has been duly appointed as trustee of the Standby Purchaser with full
power and authority to act on behalf of the Standby Purchaser and to perform the
obligations of the Standby Purchaser under this Agreement.
(D) If the Standby Purchaser is a partnership
or limited liability company, the Standby Purchaser is a partnership or limited
liability company duly organized, validly existing and in good standing under
the laws of its jurisdiction of incorporation or organization, with full power
and authority to perform its obligations under this Agreement.
(ii) The Standby Purchaser has received from the Company
and has reviewed carefully a copy of the Prospectus as well as the public
documents filed in connection therewith through the date hereof, and except as
set forth in this Agreement and in the Prospectus, the Standby Purchaser is not
relying on any information other than information contained in this Agreement or
the Prospectus.
(iii) The Standby Purchaser is acquiring the shares of
Common Stock pursuant to this Agreement for its own account for investment only
and not with a view to any resale, distribution or other disposition thereof.
(iv) The execution, delivery and performance of this
Agreement by the Standby Purchaser and the consummation by the Standby Purchaser
of the transactions contemplated hereby have been duly authorized by all
necessary action of the Standby Purchaser; and this Agreement, when duly
executed and delivered by the Standby Purchaser, will constitute a valid and
legally binding instrument, enforceable in accordance with its terms, subject to
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
similar laws of general applicability relating to or affecting creditors' fights
and to general equity principles.
(v) The Standby Purchaser is not insolvent and has
sufficient cash funds on hand to purchase the Standby Shares and Additional
Shares on the terms and conditions contained in this Agreement and will have
such funds on the Closing Date. The Standby Purchaser has simultaneously with
the execution and delivery of this Agreement or prior thereto provided the
Company with evidence or substantiated that such Standby Purchaser has the
financial means to satisfy its financial obligations under this Agreement and
the foregoing evidence and substantiation is a true and accurate representation
of such means.
(vi) No state, federal or foreign regulatory approvals,
permits, licenses or consents or other contractual or legal obligations are
required with respect to the Standby Purchaser in order for the Standby
Purchaser to enter into this Agreement or purchase the Standby Shares and the
Additional Shares.
(vii) The execution and delivery of this Agreement, the
consummation by the Standby Purchaser of the transactions herein contemplated
and the compliance by the Standby Purchaser with the terms hereof do not and
will not conflict with, or result in a breach or
5
violation of any of the terms or provisions of, or constitute a default under,
any indenture, mortgage, deed of trust, loan agreement or other agreement or
instrument to which the Standby Purchaser is a party or by which any of the
Standby Purchaser's properties or assets are bound, or any applicable law, rule,
regulation, judgment, order or decree of any government, governmental
instrumentality or court, domestic or foreign, having jurisdiction over the
Standby Purchaser or any of the Standby Purchaser's properties or assets; and no
consent, approval, authorization, order, registration or qualification of or
with any such government, governmental instrumentality or court, domestic or
foreign, is required for the valid authorization, execution, delivery and
performance by the Standby Purchaser of this Agreement or the consummation by
the Standby Purchaser of the transactions contemplated by this Agreement that
will not have been obtained prior to the Closing.
(viii) The Standby Purchaser has not entered into any
contracts, arrangements, understandings or relationships (legal or otherwise)
with any other person or persons with respect to the transactions contemplated
by this Agreement or any securities of the Company, including but not limited to
transfer or voting of any of the securities, finder's fees, joint ventures, loan
or option arrangements, puts or calls, guarantees of profits, division of
profits or loss, or the giving or withholding of proxies; and the Standby
Purchaser does not own any securities of the Company which are pledged or
otherwise subject to a contingency, the occurrence of which would give another
person voting power or investment power of such securities.
6. CONDITIONS.
The respective obligations of the Company and the Standby Purchaser to
purchase shares of Common Stock as set forth in this Agreement are subject to
the following conditions:
(a) No order suspending the effectiveness of the Registration
Statement or any amendment or supplement thereto shall have been issued and no
proceedings for such purpose shall be pending before or threatened by the SEC
and any requests for additional information by the SEC (to be included in the
Registration Statement, in the Prospectus or otherwise) shall have been complied
with in all material respects.
(b) The representations and warranties of the Company and the
Standby Purchaser contained herein shall be true and correct in all material
respects as of the Closing Date and the Company and the Standby Purchaser shall
have performed all covenants and agreements herein required to be performed on
its part at or prior to the Closing Date.
(c) The Company shall have conducted the Rights Offering
substantially in the manner described in the Prospectus.
7. TERMINATION.
(a) The Standby Purchaser may terminate this Agreement (i) upon
the occurrence of a suspension of trading in the Common Stock, the establishment
of limited or minimum prices for the Common Stock or a general suspension of
trading in or the establishment of limited or minimum prices on the New York
Stock Exchange or the Nasdaq National Market, any banking moratorium, any
suspension of payments with respect to banks in the United States or a
6
declaration of war or national emergency in the United States, (ii) under any
circumstances which would result in the Standby Purchaser, individually or
together with any other person or entity, being required to register as a
depository institution holding company under federal or state laws or
regulations, or to submit an application, or notice, to acquire or retain
control of a depository institution or depository institution holding company,
to a federal bank regulatory authority, or (iii) prior to the expiration of the
Offering, if the Company experiences a material adverse change in its financial
condition from its financial condition at December 31, 2004.
(b) In the event (x) the Company, in its reasonable judgment,
determines that it is not in the best interests of the Company and its
shareholders to go forward with the Rights Offering or (y) consummation of the
Rights Offering is prohibited by law, rule or regulation and the Company
terminates the Rights Offering, in each case, the Company may terminate this
Agreement without liability.
(c) Either of the parties hereto may terminate this Agreement (i)
if the transactions contemplated hereby are not consummated by __________, 2005,
through no fault of the Standby Purchaser or (ii) in the event that the Company
is unable to obtain any required federal or state approvals for the transactions
contemplated hereby on conditions reasonably satisfactory to it despite its
reasonable efforts to obtain such approvals. In addition, this Agreement shall
terminate upon mutual consent of the parties hereto.
(d) The Company and the Standby Purchaser hereby agree that any
termination of this Agreement pursuant to Section 7(a) (b) or (c) (other than
termination by one party in the event of a breach of this Agreement by the other
party or misrepresentation of any of the statements made hereby by the other
party), shall be without liability of the Company or the Standby Purchaser.
8. CONTINUING PROVISIONS.
The representations and warranties of the Company and the Standby
Purchaser set forth in this Agreement shall be true and correct in all material
respects only as of the date of this Agreement and as of the Closing Date. All
of the covenants, agreements and obligations of each of the Company and the
Standby Purchaser required to be performed by the Closing Date shall have been
duly performed and complied with by the Closing Date unless such performance
shall have been waived in writing by the Company or the Standby Purchaser, as
the case may be. The respective representations, warranties, covenants,
agreements and obligations of the parties to this Agreement shall survive the
Closing Date.
9. RECAPITALIZATION, ETC.
Other than as disclosed in the Prospectus, prior to Closing, the
Company shall not split, combine, reclassify or repurchase any of its capital
stock or declare or pay any extraordinary dividends on any of its capital stock.
10. MISCELLANEOUS.
This Agreement is made solely for the benefit of the Standby Purchaser
and the Company, and their respective personal representatives and successors,
and no other person,
7
partnership, association or corporation shall acquire or have any right under or
by virtue of this Agreement.
11. ASSIGNMENT.
Neither the Company nor the Standby Purchaser may assign any of its
rights under this Agreement without the prior written consent of the other party
hereto.
12. ENTIRE AGREEMENT.
This Agreement constitutes the entire agreement and understanding
between the Standby Purchaser and the Company, and supersedes all prior
agreements and understandings relating to the subject matter hereof. In case any
one or more of the provisions contained in this Agreement, or the application
thereof in any circumstance, is held invalid, illegal or unenforceable in any
respect under the laws of any jurisdiction, the validity, legality and
enforceability of any such provision in every other respect and of the remaining
provisions contained herein shall not be in any way affected or impaired thereby
or under the laws of any other jurisdiction.
13. COUNTERPARTS.
This Agreement may be executed in any number of counterparts, each of
which when so executed and delivered shall be an original, and all such
counterparts together constitute but one and the same instrument.
14. AMENDMENTS.
This Agreement may not be amended, modified or changed, in whole or in
part, except by an instrument in writing signed by the Company and the Standby
Purchaser.
15. NOTICES.
Except as otherwise provided in this Agreement, and unless otherwise
notified by the respective addressee, all notices and communications hereunder
shall be in writing and mailed or delivered or by facsimile or telephone if
subsequently confirmed in writing, to:
If to the Company:
Patriot National Bancorp, Inc
000 Xxxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Attention: Xxxxxx Xx Xxxx
Chairman and Chief Executive Officer
Telephone: 000-000-0000
Facsimile: 000-000-0000
8
With a copy to:
Xxxxx Xxxxxx & Alconn, LLP
000 Xxxxxx Xxxxxx
Xxxx Xxxxx 00xx Xxxxx
Xxxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxx III, Esq.
Xxxxx Xxxx Xxxxxxxxxx, Esq.
Telephone: 000-000-0000
Facsimile: 860-278-3802
If to the Standby Purchaser:
______________________
______________________
______________________
Attention:
Telephone:
Facsimile:
16. APPLICABLE LAW.
This Agreement shall be governed by and construed in accordance with
the laws of the State of Connecticut, without regard to the conflict of laws
rules thereof.
17. BUSINESS DAY.
The term "business day" shall mean a day on which banking institutions
are open generally in New York.
9
IN WITNESS WHEREOF, and intending to be legally bound hereby, each of
the Standby Purchaser and the Company has signed or caused to be signed its name
as of the day and year first above written.
PATRIOT NATIONAL BANCORP, INC.
By:
-------------------------------
Name: Xxxxxx Xx Xxxx
Title: Chairman and Chief Executive Officer
Agreed and Accepted as of the day of
the ___ day of __________, 2005:
---------------------------
By:
--------------------------
Name:
Title:
10
